How tort reform led to Texas growth
Ten years ago, Texas was known as a “judicial hell hole,” thanks to a torts system that was out of control — and the people who paid the price were the ordinary men, women, and children of the Lone Star State. The story of how that was fixed is a lesson for policy change today.Getting malpractice cases under control help to create the Texas growth spurt. The only people who don't like it are the Texas trial lawyers who have become the money bags for the Democrat party. They are pushing to change Texas from red to blue, but if they succeed Texas would suffer the way California does with excess regulation and litigation.
Nowhere was the situation in Texas in 2003 more dire than in our state’s health care sector. One out of four doctors in Texas had a malpractice claim filed against them each year. Eighty-five percent of all medical malpractice claims failed, but each cost more than $50,000 to defend. Meanwhile, the number of medical malpractice insurers in the state dropped from 17 in 2000 to four in 2003. Premiums skyrocketed, with Texas’ physicians paying about the same malpractice rates as doctors in New York.
Perhaps the most important reform was the capping of noneconomic damages at $250,000 for doctors, with an additional cap of $250,000 for each of up to two medical care institutions. This provision went to the Texas voters, who approved it in the fall of 2003.
Ten years later, we can see the benefits of these reforms. As the New York Times put it, “Four years after Texas voters approved a constitutional amendment limiting awards in medical malpractices lawsuits, doctors are responding as supporters predicted, arriving from all parts of the country to swell the ranks of specialists at Texas hospitals and bring professional health care to some long-underserved rural areas.”
In May 2005, the American Medical Association removed Texas from its lists of states in crisis. Texas is, so far, the only state to be removed from this list.
The most significant achievement has been the increased access to health care. By the end of 2013, just over ten years after the effective date of HB 4, Texas will have somewhere close to 60,000 doctors to care for its citizens, almost twice as many as it had in 2003.
It’s no coincidence that since 2003 Texas has also distinguished itself as the national leader in job growth. Texas is only one major company away from leading the way as the nation’s top home for Fortune 500 companies.